Fallout on WTO Ruling

U.S. farmers fear developing countries smell blood after last Monday’s WTO ruling, which supported Brazil’s claim that U.S. cotton subsidies are trade distorting.

"The programs we have for cotton are also used in other commodities," said Paul Drazek, a former adviser in the US agriculture department. "Any rulings that would call into question the legitimacy of how they're operated would also apply to other commodities."

However, trade experts say a flood of cases are not likely to come soon. For one thing, the WTO panel ruled that U.S. subsidies caused “serious prejudice to Brazilian cotton producers.”

Following the ruling, the White House vowed that it will work with Congress and the farming sector to defend subsidies.

"We believe that United States farm programs were designed to be and are fully consistent with our WTO obligations," said the White House spokesman, Scott McClellan, after the WTO ruled in favor of Brazil's complaint that U.S. cotton subsidies lower world prices and price developing nations' goods out of markets.

"We will be defending U.S. agricultural interests in every form we need to," he said, "and have no intention of unilaterally taking steps to disarm when it comes to this."

Posted by Jim Langcuster at April 28, 2004 09:42 AM | TrackBack